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Supply-demand imbalance is fuelling house price rises – RICS

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  • 13/05/2021
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Supply-demand imbalance is fuelling house price rises  – RICS
Chartered surveyors have witnessed house prices rise higher in April on limited sales listings, the monthly RICS Residential Survey has found.

 

The balance of surveyors, +75 per cent, said prices increased in April, up on March’s survey when it was +62 per cent.

The average number of properties on estate agency books stood at 40, compared to 46 in December, the survey found.

Meanwhile, buyer demand was sustained at a high level, with a balance of +44 per cent of respondents citing an increase in enquiries, compared to +43 per cent in March.

“The shortfall in supply relative to demand is coming through loud and clear,” said Simon Rubinsohn, chief economist at RICs.

“It may be simplistic to assume that higher numbers can redress affordability, but delivery does have a role to play.

“Ensuring a broad range of tenures in the delivery pipeline is also important, with anecdotal evidence from the survey emphasising a severe lack of stock in private rental as likely to drive up rents sharply over the next year,” Rubinsohn said.

Market experts’ suggestions for boosting supply included an idea from Tomer Aboody, director of property lender MT Finance, “to remove or reduce stamp duty for downsizers, as this would bring more properties onto the market.”

Others looked to planning reforms noted in the Queen’s Speech on Tuesday as providing some relief in future years.

“These will go some way towards facilitating new-builds in within the next few years,” said Nigel Purves, chief executive at Wayhome.

Sundeep Patel, director of sales at specialist lender Together, said the planning changes may result in “increased opportunities for hopeful first-time buyers within the next few years.”

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